Crude oil rose from a 19-month low in New York after some traders said this week's drop in oil prices wasn't justified. Some analysts expect OPEC's members to cut production to stop prices from declining.
Crude oil fell 6.4 percent this week in New York as mild weather in the U.S. Northeast, the region that consumes the most heating oil, cut demand. OPEC President Mohamed al-Hamli said yesterday's drop below $53 a barrel was ``unacceptable'' and urged members to comply with the cuts in output they had promised to make in November and in February.
``The supply sides are going to remain tight,'' said Greg Smith, the U.K. managing director of the investment advisers Fat Prophets U.K. Ltd. ``OPEC can be successful in getting that price up, certainly getting it back towards $60 a barrel.''
Crude oil for February delivery rose as much as $1.06, or 2 percent, to $52.94 a barrel in after-hours electronic trading on the New York Mercantile Exchange, its first gain this week. The contract traded at $52.34 at 12:58 p.m. in London.
Brent crude oil for February settlement climbed as much as $1.24, or 2.4 percent, to $52.94 a barrel in electronic trading on the ICE Futures exchange and traded at $52.36 in London.
Some analysts and brokers expect a forecast for colder weather next week to push prices higher. Colder weather will reach the northeastern U.S. Jan. 17 through Jan. 21, according to the U.S. National Weather Service. Temperatures in the region were milder than normal through the first part of winter. New York had its third-warmest December on record.
``The temperature is expected to drop below normal after'' the next five days, said Michael Davies, an analyst in London with broker Sucden (U.K.) Ltd. ``Many traders are expecting OPEC to take action in order to support prices.''